Effect of transformational leadership on employee performance: a perspective of leader’s influence

Abstract

The study examined the effect of transformational leadership on employee performance in the banking sector based on the leader’s influence perspective. Literature review revealed that the ability of the leader to influence the followers is centred on idealised influence (model the way) and inspirational motivation (communicating appealing vision) factors of transformational leadership. The motivation for the study was because information on how idealised influence and inspirational motivation affect employees performance in the banking sector in Sub-Saharan countries had been rarely addressed. Where addressed, the findings are tokenistic, discrete and imprecise. A sample of 132 employees who were working in the banking sector was surveyed using a self-administered structured questionnaire and a simple random sampling technique. Multiple linear regressions were used to estimate the relationship between the predicators and an independent variable. An in-depth interview was also employed to collect qualitative data from ten employees selected using the purposive sampling technique from ten different banks. Thematic analysis was used to analyse qualitative data to supplement the quantitative findings. The study revealed that idealised and inspirational motivation positively influence the performance of employees in the banking sector. The study has got four knowledge contributions. Firstly, contrary to other empirical studies, this study adopted mixed methods research design. Secondly, the study revealed that employee’s performance is enhanced if supervisors become good role models and at the same time inspire employees to commit to the bank’s vision. Thirdly, idealised influence and inspirational motivation factors are significant to the employees performance and are the learned behaviours. Fourthly, leaders should be careful with their decisions and actions because employees are likely to emulate the leaders' behaviours by trusting that whatever they do is correct and acceptable.